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"The yen has shown maximum sensitivity to risk sentiment in the recent weeks. The upside for the yen, though, is likely to be capped before the Bank of Japan meeting next week, given they too are struggling with weakening inflation prospects."
- Credit Agricole (based on Business Recorder)
Pair's Outlook
On Wednesday the US currency edged closer to the 2015 low, but managed to recover from the daily low and stabilise just under the 117.00 level. The risk-off sentiment appears to be present today as well, meaning the USD/JPY is poised for more weakness. As a result, the Buck could drop towards the weekly S1—the first level of the immediate support cluster. At the same time, the weekly PP and the monthly S2 form a resistance circa 117.50, which was tested earlier today and triggered a sell-off, suggesting a break is unlikely. Meanwhile, technical studies imply the pair is to suffer another loss.
Traders' Sentiment
Bearish market sentiment remains unchanged at 70%, while the number of sell orders lost 2% points down to 66%.
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